Crypto still relies on the real banking system to feed real cash into and out of their system. States have tight control over the banks.
If crypto exchanges/standards don't want to do KYC, they won't be able to interact with the real economy.
If crypto exchanges/standards don't want to do KYC, they won't be able to interact with the real economy.
Before state currencies, the barter system existed -- even today, it still does exist, and crypto in a lot of ways is in theory supposed to bring things digitally back to that age old system.
States have control over banks only so far as they maintain a /global/ monopoly over force and a mandate in popular support which they can practically demonstrate. What you're talking about is the distance between de facto and de jure, and I think what you're missing is how the former leads the latter, not the other way around.
This isn't to say that your second point is completely incorrect, I just think it misplaces the center of gravity -- I think that will practically lie with the merchant given that an exchange can be decentralized enough that there is no "neck to squeeze" when misbehavior occurs.
A variety of credit/debt based decentralized stablecoins and dexes will take over in the long run from centralized exchanges and bank account onramp. Even centralized exchanges are trying to get exposure to defi protocols now that will eventually obsolete them for traditional functions for all but the tech laggards.
Elsewhere, other than dark web drugs and jpegs of apes, what exactly are people buying with crypto?